Considered
and decided by Stoneburner,
Presiding Judge; Kalitowski,
Judge; and Dietzen,
Judge.

U N P U B L I S H E D O P I N I O N

STONEBURNER, Judge

In this appeal from post-dissolution
orders, appellant challenges the district court’s award of attorney fees to
respondent, argues that the district court erred in calculating his disposable
income, and erred by ordering him to pay more for child support and maintenance
from his long-term disability benefits than is permitted by state and federal
law. Appellant also argues that the
order finding him in contempt of court for failing to pay attorney fees should
be vacated. Respondent moves to strike
portions of appellant’s brief and to dismiss the appeal. We deny respondent’s motion to dismiss the
appeal but grant in part the motion to strike.
We reverse the attorney fee awards and vacate the finding of
contempt. We affirm the district court’s
calculation of husband’s net income from private long-term disability because
husband failed to demonstrate that the calculation is clearly erroneous.

FACTS

The district court dissolved the
13-year marriage of appellant Steven Stoltman (husband) and respondent Marilyn
Stoltman (wife) by a stipulated judgment in October 2003. Under the judgment, the parties share joint
legal custody of their two minor children, and wife has sole physical custody
subject to husband’s parenting time. At
the time of the judgment, husband had a net monthly income of $4,842 and
monthly expenses of $3,631, and wife had a net monthly income of $1,578 and
monthly expenses of $3,865. The judgment
provided for satisfaction of over $60,000 of non-mortgage debt from tax-return
refunds, the sale of the homestead, and liquidation of retirement accounts and life
insurance policies.

To obtain favorable tax
consequences, the parties agreed, with the district court’s approval, to
“blended-support” that delineated a portion of husband’s child support as
maintenance. The judgment requires
husband to pay wife $200 per month in child support and $2,280 per month in
maintenance, with a provision that if husband’s annual income exceeds $125,000
for three consecutive or non-consecutive years before the 18th birthday of the
eldest child, husband will pay $20,000 as additional support. The parties waived future modification of
maintenance, and the district court divested itself of jurisdiction over
maintenance but provided that in the event either party “becomes permanently
disabled under the Social Security Act, the party shall be relieved of the Karon waiver and the spousal maintenance
terms shall be reviewed de novo.”

In November 2005, wife moved for an
increase in child support to then-existing guideline levels. Husband filed cross-motions, including a
motion to set aside the blended-support provision of the judgment for “fraud”
based on wife’s assertion that the child-support guidelines, rather than the judgment’s
blended-support provision, control the amount of husband’s child-support
obligation. The first hearing on these
issues was held on November 15, 2005, resulting in the first of the series of
orders that are the subject of this appeal. Both parties had requested substantial
attorney fees in connection with the motions heard on November 15, 2005. On the record, the district court, in part,
(1) denied wife’s motion for an increase in child support through the date of
the motion, but reserved a decision on post-hearing date increases; (2) ordered
husband to pay $1,000 immediately upon receipt of any discovery request from
wife “[i]n order to permit [wife’s attorney] to pursue the discovery she might
pursue,” but otherwise reserved the issue of attorney fees; and (3) ordered
husband to provide tax returns that disclosed his new spouse’s income. A written order incorporating these rulings
was issued on December 29, 2005.

Two days after the November 15
hearing, wife’s attorney served additional discovery on husband, triggering his
obligation to immediately pay $1,000 in attorney fees. Husband largely complied with the discovery
requests but notified wife that he could not afford to pay the attorney-fee
award.

On January 3, 2006, husband took a
medical leave of absence from his employment at the direction of his physician
and psychologist. On January 19, 2006,
the parties and counsel had an in-chambers conference with the district
court. As a result of this unreported conference,
the district court issued an order dated January 31, 2006, sua sponte finding that
“an additional award of $500 towards [wife’s] attorney’s fees is
appropriate.” The order designates the $1,500
in outstanding attorney fees awarded to wife as child support in order to avoid
husband discharging the obligation in bankruptcy. The district court also ordered husband to
provide more documentation concerning his financial situation. Husband, who had remained current with his
support obligation through February 2006, filed for bankruptcy in February 2006
and stopped paying support.

In April 2006, wife moved for an
order finding husband in constructive-civil contempt for failing to pay the $1,500
in attorney fees now designated as child support. Wife also moved for additional attorney fees,
supported by an affidavit showing that she had incurred attorney fees in the
amount of $11,291 since November 2005. Each
page of the timesheets which were attached to the affidavit contains the
notation: “CHILD SUPPORT AND VISITATION,” but the timesheet entries did not indicate
which entries were for child support and which were for visitation.

The contempt motion was heard on
April 20, 2006. In a written order dated
May 19, 2006, the district court found husband in contempt of court for failing
to provide previously ordered financial information until the date of the
hearing, failing to advise anyone that he had opened a new account in December
2005, failing to pay the $1,500 award by the date set, and failing to pay
regular monthly support in the amount ordered from March through April 5, 2006. The district court found that husband had the
ability to pay, noting that he had earned $139,746 in 2005, including a bonus
he received in February 2006, but “chose to send $13,000 to the IRS for taxes rather
than paying the maintenance and child support as ordered.” The district court reserved wife’s request
for additional attorney fees, set conditions for husband to purge the contempt,
and scheduled a review hearing for May to review husband’s ability to pay
support arrearages and the purge conditions.

On May 19, 2006, the district court
held an evidentiary hearing to determine husband’s ability to pay the purge
conditions set out in the prior order. Based
on the order from this hearing, it appears that the only purge condition that husband
failed to meet was payment of the outstanding $1,500. The district court found that husband had
failed to prove that he was disabled from working, implying that husband’s
ability to care for his one-year-old child demonstrated that he was able to work. Based on an implicit finding of husband’s
ability to pay, the district court concluded that husband remained in contempt
and ordered him to pay $1,500 by May 31, 2006.

On July 17, 2006, the district court
held another hearing on the contempt issue. At that hearing, husband’s attorney disclosed
that husband was now receiving long-term disability payments from ING, his
disability insurer, in the gross amount of $5,700 per month and that he was
eligible to receive such payments for up to 24 months. There was some discussion about husband’s net
monthly income from long-term disability payments. Husband asserted that his net income was
approximately $2,900 but the district court, on the record using the tax-table
rate for married, filing separately, calculated his net income to be $4,503. The district court again found that husband
had had the ability to pay the $1,500 and the full amount of support,
suggesting that he could have borrowed money to meet his obligations.

Husband’s attorney attempted to
argue that husband had complied with all discovery requests and that the first
$1,000 in attorney fees was inappropriately awarded. The district court said:

Look,
. . . the basic facts of this case . . . [are] a bunch of money went through
[husband’s] hands and he didn’t pay [wife] when he could have. He paid the government instead. He benefited himself, without taking care of
his kids. That’s the short form. The rest of this is all play. It’s all tinkering on the edges.

The
district court denied wife’s pending motion to increase child support but awarded
wife an additional $11,299 in attorney fees, ordered husband to pay the
previously awarded $1,500 immediately, and ordered husband to pay the full
gross amount of his first-month of long-term disability to wife or her
attorney. Husband’s attorney argued that
under federal law, husband could not be compelled to pay more than 50% of his
monthly income, whereupon the district court stated:

This
is a contempt proceeding, . . . I guess I don’t have to tell where the money
comes from . . . If he wants to stay out of the jail he has to pay the $1,500,
and he has to pay an additional $4,000 in support, and the total of it must be
paid in the next 21 days. . . . He is to report to the workhouse at 9 a.m. 21
days from today if he’s not paid the $5,500 sum.

The
district court also ordered that the $11,299 attorney-fee awarded would be
“additional child support,” and ordered husband, to avoid ongoing contempt, to
pay ongoing support ordered plus 20% of that amount “until the arrears and
attorney’s fees are satisfied.” Of the
20%, half was to go to attorney fees and half to support arrearages. Husband
paid support arrearages, but did not pay the $1,500 in attorney fees. The district court issued a commitment order
for husband to serve 90-days jail time because he failed to meet the purge
conditions. Husband sought a writ of
prohibition from this court seeking to preclude enforcement of the jail time,
which was denied. Husband appealed the
orders for attorney fees, support, and contempt. Husband moved the district court to stay the
commitment order pending appeal and requested the court to modify amounts that
can be withheld from his disability checks.
The district court directed husband to post a $1,500 bond to avoid
incarceration pending appeal and noted that husband was “free to bring a motion
regarding the long-term disability attachment.”

This appeal follows. Wife has moved to strike a portion of the
appendix to husband’s brief and to dismiss the appeal on several grounds,
including the inadequacy of the record to ensure proper review.

D
E C I S I O N

I. Attorney
fees

Husband
argues that the district court abused its discretion by ordering him to pay
attorney fees to wife in its orders of December 29, 2005 ($1,000), January 31,
2006 ($500), and July 26, 2006 ($11,299).
A district court in a dissolution-related action “shall” grant attorney
fees when necessary for the good-faith assertion of a party’s rights if the
party seeking fees lacks the ability to pay the fees and the party from whom
the fees are sought has the ability for payment. Minn.
Stat. § 518.14, subd. 1 (2006). The
district court may also order attorney fees if a party unreasonably contributes
to the length or expense of the proceeding.
Id. This court reviews a determination
on attorney fees for abuse of discretion.
Gully v. Gully, 599 N.W.2d
814, 825 (Minn.
1999). When awarding fees in a
dissolution case under section 518.14, the district court must indicate whether
the award is based on need or conduct and address the statutory factors for the
kind of award involved. Geske v. Marcolina, 624 N.W.2d 813, 816
(Minn. App.
2001).

a. Order of December 29, 2005

Wife argues that because she was
served with the notice of filing of the December 29, 2005, order on January 17,
2006, and the notice of appeal was not filed until September 28, 2006,
husband’s appeal of that order is untimely.
See Minn. R. Civ. App. P. 104.01, subd. 1 (stating
that an appeal may be taken from an appealable order within 60 days after
service of written notice of filing of the order). But this court “may review any order
affecting the order from which the appeal is taken,” and may take any action
that the interests of justice require. Minn. R. Civ. App. P. 103.04. The December 29, 2005, order directly affects
the January 31, 2006, order, which husband is timely appealing, because the
January 31 order is based on husband’s failure to complete discovery and pay
attorney fees ordered in the December 29 order.
We will therefore review the December 29 order.

The December 29, 2005 order directs
husband to “immediately pay $1,000 of [wife’s] attorney fees if and when [wife]
serves [husband] with discovery requests,” and otherwise reserves the issue of
attorney fees. The order appears to be
for need-based fees, because it was made immediately following a comment by
wife’s attorney that wife had moved for need-based attorney fees and that the
district court “has now directed me to do three more things, including going to
CarverCounty[1]
and do a lot more discovery.[2] I’ll probably have to take his
deposition.” The district court,
however, did not make findings or statements on the record concerning the basis
for the award or the amount of the award, or address the statutory factors
necessary for either a need-based or conduct-based award. A lack of specific findings is not fatal to a
need-based award when this court is able to infer that the district court
considered the statutory factors, was familiar with the case, and had access to
the parties’ financial records. Geske, 624 N.W.2d at 817.

In this case, the record shows that,
at the time of the November 15, 2005 hearing, husband earned more income than
wife. But under the stipulated judgment,
husband’s $4,842 net monthly income was reduced by support payments of $2,480, while
wife’s $1,578 net monthly income was augmented in the same amount, leaving
husband with $2,362 to meet monthly living expenses of $3,631, and giving wife
$4,058 to meet her monthly expenses of $3,865.
Nothing in the record explains how husband, who faced a monthly
shortfall of $1,269 between income and reasonable expenses, could be found to
have the ability to pay wife’s attorney fees.
Nor is there any explanation of wife’s need. Because on this record we cannot infer wife’s
need or husband’s ability to pay, and because there is no indication or support
in the record for an award of conduct-based attorney fees at that time, we
reverse this award of attorney fees.

b. Order of January 31, 2006

In the order following the
unreported chambers meeting, the district court sua sponte awarded an
additional $500 in attorney fees to wife without making any findings on the
basis for such an award. The district
court also sua sponte designated the attorney fees awarded as child support in
order to keep husband from having this debt discharged in bankruptcy. As noted above, even if wife established a
need for these additional fees that she had not requested, we are unable to
infer that husband had the ability to pay, especially in light of the fact that
he was, by this time, on medical leave from his job. The only possible basis for an award of
conduct-based fees appearing on the record is husband’s failure to pay the
first $1,000, which we have determined to have been improperly awarded. We therefore reverse the award of the additional
$500 as unsupported in the record.
Because we are reversing these awards, we do not reach the issue of
whether the district court properly designated the amount as child support.

c. Order
of July 26, 2006

At the July 17 hearing to determine
husband’s ability to pay contempt-purge conditions, the district court learned
that husband was now receiving long-term disability benefits. But the district court again made conclusory
findings that husband had the ability to pay all previously ordered attorney
fees and ongoing support, and it awarded wife an additional $11,299 in attorney
fees, finding that the fees were fair and reasonable, that wife had no capacity
to pay the fees, and that husbands’ conduct was “the reason this litigation has
been prolonged.” The court stated:

[Husband] had income in 2005 of
$139,756.00, including a bonus received in February 2006. Had he paid at least some of that money to
comply with the Court’s attorney fees [o]rder in January, 2006, the remainder
of these attorney fees may not have been necessary. His failure to pay child support and
maintenance, and previously to provide discovery, caused [wife] to incur fees
far beyond what would have been necessary had [husband] complied with the
Court’s Orders. The bulk of those fees
were incurred to collect child support and maintenance.

The
district court did not delineate what portion of this fee award was need-based
and what portion was conduct-based.

Husband argues that the district
court abused its discretion in ordering these attorney fees because he had
remained current in his child-support payments through February 2006 by
withholding less than was necessary to meet his legitimate tax obligation,
requiring him to use his bonus money to pay the IRS. Husband argues that he did not have the
ability to meet his support obligations after he went on medical leave and had
no ability to pay wife’s attorney fees.

To the extent that the award of $11,299
in attorney fees was based on husband’s failure to pay the $1,500 in fees which
we have now reversed, this further award of fees constitutes an abuse of
discretion. Furthermore, the affidavit
supporting the request for fees shows that only $4,357 of the requested fees
was incurred after husband began to incur support arrearages, and the record
does not support that the additional fees incurred related to support
collection.[3]

Additionally, the district court’s
finding on husband’s ability to pay need-based fees is unsupported by the
record. The district court appears to
have considered only husband’s income and to have ignored his legitimate
expenses, to conclude that husband was able to pay wife’s attorney fees. The district court’s only finding that would
support a conduct-based award is a conclusory statement that husband’s conduct
has “prolonged the litigation” without specifying what conduct by husband has
forced wife to incur the asserted fees. Furthermore,
because wife’s motions contained requests for relief unrelated to support, the
designation of the entire amount as child support or maintenance-related is not
supported by the record. Because the
record does not support the award of either conduct-based or need-based fees in
the amount awarded or that the amount awarded was primarily incurred in
child-support enforcement efforts, we reverse this $11,299 award. See
Kronick v. Kronick, 482 N.W.2d 533, 536 (Minn. App. 1992) (stating that district
court must make findings regarding the basis for conduct-based attorney fees in
order to “permit meaningful appellate review”).

Because we have reversed all of the
attorney fee awards, we do not reach the issue of the effect of husband’s
bankruptcy on those awards.

On the record at the July 17, 2006,
hearing, the district court determined that husband’s net monthly income from his
ING disability benefits was $4,503 per month.
Husband asserts that this finding is clearly erroneous because the court
based the calculation on an incorrect tax-filing status for husband, rather
than husband’s actual filing status (which is not entirely clear from the
record before the court).

Wife argues that because the district
court had denied both parties’ motions for modification of husband’s child-support
obligation, the calculation of husband’s net income from disability payments
under the child-support guidelines is irrelevant, and any error in calculation
was not prejudicial to husband. But wife
requested arrearages and continuing support during the period husband was
receiving long-term disability benefits, and husband continued to assert an
inability to pay, so the calculation was not moot at the time of this appeal. But on the record before this court, we cannot
determine that the district court’s calculation of net income from husband’s
ING disability benefits is clearly erroneous.

III. Effect of consumer
credit protection laws on amounts that can be withheld from husband’s disability checks

Husband maintains that the district
court erred by requiring amounts to be withheld from his disability check
exceeding the amounts permissible under the federal Consumer Credit Protection
Act, 15 U.S.C. § 1673 (b)(2) (2000), and its state counterpart, Minn.
Stat. § 571.922 (2006). The federal
statute prohibits garnishment over certain limits of a support-obligor’s
aggregate disposable earnings for any workweek.
See 15 U.S.C. § 1673
(b)(2)(A). The state statute contains similar
restrictions. See Minn.
Stat. § 571.922. Husband points to
language in both statutes restricting the powers of the courts to “make,
execute, or enforce any order or process” that violates these limitations. See id.;
see also LaFreniere-Nietz v. Nietz,
547 N.W.2d 895, 898 (Minn. App. 1996) (stating that language in the state
statute “prohibits a court from permitting a creditor to garnish a judgment in
an amount that exceeds the stated limitation”).

Wife maintains that husband failed
to raise this issue in the district court, so this court need not consider
it. See
Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988) (stating that this court
generally will not consider matters not argued and considered in the district
court). Husband’s attorney argued at the
July 2006 hearing that under federal law, no more than 50% of husband’s disability
check could be garnished, but the district court, in its October 26, 2006,
order, stated that husband had not properly brought the issue before it. Because husband never formally requested a
ruling on this issue and the district court has not addressed this issue, we
decline to address it.

IV. Contempt

To support an order of confinement
for contempt, the district court must find that the contemnor had the ability
to satisfy the purge conditions set by the district court at the time of the
confinement. Schubel v. Schubel, 584 N.W.2d 434, 436 (Minn. App. 1998). The district court found that husband
“clearly has the capacity to continue his comfortable lifestyle.” But this finding is based on the income of
husband’s current spouse, rather than husband’s income. Husband correctly argues that his current
spouse is not responsible for his support obligation to wife. Although the district court implies that if
husband is able to care for the child of his current marriage, he is able to
work, the record does not support this determination. Wife has not produced evidence that husband’s
disability is a sham or that he is intentionally unemployed in an effort to
avoid his support obligation. We
conclude that there is insufficient evidence in the record to show that husband
has had the ability to satisfy the financial purge conditions, and we therefore
reverse the finding that he is in contempt of court.

V. Respondent’s motion to
strike and motion to dismiss

Wife
moved to strike certain portions of husband’s appendix on the ground that they
are not part of the record on appeal, and to dismiss the appeal, inter alia,
because transcripts were not filed and the remaining record is inadequate for
review. This court at special term
deferred both motions to the panel. Since
that order, husband has supplied transcripts of the hearings pertaining to the
December 29, 2006, January 31, 2006, and October 26, 2006, orders. These transcripts are sufficient to allow
appellate review. See Minn. R. Civ. App. P. 110.02 (addressing transcripts for appeal
purposes). We therefore deny wife’s
motion to dismiss for lack of an adequate record.

The record on appeal consists of
“[t]he papers filed in the trial court, the exhibits, and the transcript of the
proceedings.” Minn. R. Civ. App. P. 110.01. Husband admits that certain exhibits in his
appendix, namely, Exhibit 9 (ING employee-benefits specialist’s letter to
husband), Exhibit 19 (Landscape Alternatives’ letter to husband), Exhibit 30
(analysis of husband’s income), and Exhibit 33 (analysis of wife’s attorney
fees) should be stricken. We agree and
grant the motion as to those documents.
Because this court did not rely on any of the additional exhibits wife
objected to, we conclude that wife’s motion as to those documents is moot.

Affirmed
in part and reversed in part; motion to strike granted in part; motion to
dismiss denied.

[1]Husband and his new spouse had obtained a
restraining order against wife to prevent her harassment over parenting
time. At the November 15, 2005 hearing,
the parties disputed whether there had been an agreement concerning that order,
and the district court ordered the parties to clarify that issue with the
issuing court in CarverCounty.

[2]The district court had not ordered additional
discovery, but had denied, in part, wife’s request for an increase in child
support due to wife’s failure to meet her burden to support an increase.

[3]SeeMinn.
Stat. § 518.14, subd. 2(a), (b) (2004) (providing that a child-support oblige
is entitled to recover reasonable attorney fees and other collection costs
incurred to enforce a child-support judgment under certain conditions, and that
attorney fees obtained under this subdivision are considered child support).